Simpler consumer protection is years away

Thursday, 31 Oct, 2003 0

ABTA Convention Special: ABTA is proposing a complete overhaul of the consumer protection scheme for holidays, but says it will be years before any changes are made.

The proposals, presented by ABTA, and other organisations including Advantage, AITO, FTO, Midconsort, Worldchoice and GBTA, recommend a simpler all-encompassing scheme.

Speaking at a press conference at the ABTA Convention on Thursday, ABTA chief executive Ian Reynolds (right of picture) said: “The approach we would like to take to improve consumer protection is to introduce a small sum to be charged along with other travel arrangements. We have said notionally that this will be about GBP1. This would protect the consumer against failure of the agent, the operator, the airline, or the hotel.”

According to ABTA, the money would be collected by the retailer, operator, airline or hotel, or any other entity that takes client repayment.

ABTA criticises the current scheme because it is complex. It says consumers have been left confused as to what is protected and what is not since the rise of no-frills airlines and self-packaged holidays. According to ABTA the proposed scheme would “remove cost burdens related to bonding and credit card risk from British traders and make them more competitive in the UK and EU”.

Mr Reynolds said a statutory body would register travel providers and look after the fund raised from the GBP1 charged to consumers. He said, based on an industry which books 38 million holidays a year, this would provide a fund of GBP38 million per year. This money would be used by the body to refund or compensate consumers whose travel arrangements are ruined by a travel provider failing.

Mr Reynolds said there would need to be “some sort of bridging arrangement” between the current system and the new system, while the fund is built up, so that it “could cover something like a large airline failure.”

He added: “We are a long way away from naming the scheme – until we get the support it´s not worth doing that. The timescale is years. There is no political appetite for this at the moment. It is not seen as a priority.”